You have worked hard for your assets so it is important to protect them. The financial arena is constantly changing which can be a minefield for the busy professional unable to keep up-to-date with every nuance of every new regulation.

Lifetime Allowance

The lifetime allowance (LTA) now limits the total amount you can accumulate in pension funds free-of-tax to £1.25million – a cut of over 30% since April 2012. This will change again to £1million in 2016. Have you checked where you stand? The penalty tax rate can be 55% if the limit is breached.

Pension Protection

Following the reduction to the LTA rate in 2014, the pension protection scheme Individual Protection 2014 (IP14) was introduced to restore a personal LTA to the value of pensions benefits on 5 April 2014 (if they exceeded £1.25million, up to a maximum of £1.5million at that time). IP14 can be used even if you already hold Fixed or Enhanced Protection and there are no restrictions on the growth of future benefits. Do you have the right protection in place?

The taxation of pension benefits is a particularly complex area where more senior doctors are coming unstuck through poor advice – either because their former advisers do not consider pension protection or do not wish to advise on the complex NHS pension.

Annual Allowance

The annual allowance has now capped the maximum amount of tax-relievable pension contributions you can make each year to £40,000. Be wary of any NHS pay rises received through increments, new management positions, CEA awards or by any other means. Immediate tax charges of up to 50% can be avoided with planning.

The September rate of inflation as measured by the Consumer Price Index (CPI) is used to determine NHS inputs for annual allowance purposes in the next tax year. For 2015/2016 the rate used will only be 1.2% (it has been as high as 5.2% in recent years) meaning many more doctors will be caught by the annual allowance limit.

HMRC bases calculations for pensions’ contributions on the deemed growth of the pension in the year so the figures used bear little resemblance to the amount you have actually paid into your pot.

Personal Allowances

Are you taking advantage of your available allowances every year such as ISAs, capital gains and gift allowances, or maximising tax reliefs through annual pension allowances? This includes allowances for your spouse and family.

Individuals have an annual capital gains allowance of £11,000. This provides great scope to harvest investment gains every year free of tax. With proper stewardship you can both build a good sized portfolio.

Adhering to the current savings regulations and using all personal allowances will mean less duty owed to HMRC and more funds left in the pot to fund the lifestyle you choose.